Category: Featured

JT Boosts Investment in Heating Products

Photo: JI
Japan Tobacco will invest ¥300 billion ($2.25 billion) in its tobacco-heating products (THPs), with ¥200 billion designated for marketing the sticks internationally, reports Nikkei Asia
“Last year, we couldn’t make the investment because there were not enough [heated-tobacco] devices due to the semiconductor shortage,” Japan Tobacco President Masamichi Terabatake was quoted as saying. “For 2023, we are back on track for procurements, and we are able to secure more than twice Japan’s supply volume compared to last year.”
JT plans to roll out its Ploom X THP in more than 10 countries this year, reaching at least 20 new countries by the end of 2024. Currently available only in Japan and the U.K., the product is set to debut in Italy this month.
To gain name recognition, JT will invest in pop-up shops and digital sales. It will develop flavors that match the tastes of each market.
In the U.S., JT formed a joint venture with Altria Group. The partners will seek permission from the Food and Drug Administration to market Ploom by early 2025.
While JT’s THP segment is currently in the red due to the forward investments, the company anticipates turning a profit in 2028 on overseas growth.
JT will also invest in research and development, looking to develop the second generation and third generation of Ploom X devices.
Global sales volume for cigarettes shrank 1.5 percent last year, JT said. By contrast, the global market for THPs last year grew 17 percent to $33.4 billion, according to Euromonitor International.
April 17, 2023
California Shelves Endgame Bill

Photo: Kit Leong
California lawmakers have quietly shelved a proposal to ban people born after Jan. 1, 2007, from buying tobacco products, reports Jefferson Public Radio.
In February, assembly member Damon Connolly introduced a bill that would make it illegal for anyone in California who is presently 16 years old or younger to ever buy a tobacco product in that state. Vendors caught selling would risk fines of up to $6,000 and a loss of their tobacco license. The minimum age to buy tobacco products in California is presently 21, as it has been in every U.S. state since the law was changed in 2019. The proposed legislation is similar to laws passed in New Zealand and considered elsewhere, including Hong Kong and Malaysia.
Connolly’s bill struggled to attract backing, however. By mid-April, only 10 organizations, including the California chapter of the American Academy of Pediatrics, had sent letters of support to the Assembly Health Committee, where it was first set to be considered, according to an analysis prepared by the committee.
The committee reportedly suggested that phasing out tobacco sales in California was less urgent because adult and youth smoking rates are only slightly higher than half the national average. “The legislature may want to consider whether it would be more effective to focus on enforcing the flavored tobacco ban rather than engaging on a new front and attempting to prevent a product that is legal in 49 other states, as well as on sovereign tribal lands, from entering the state,” the committee wrote.
At the Assembly Health Committee hearing on April 11, Connolly accepted amendments from the committee that changed the focus of his bill. It will now authorize the California Department of Public Health and the state attorney general’s office to enforce the recently enacted flavored tobacco ban, in addition to local agencies.
April 17, 2023
Dutch Institute Urges Darker Cigarettes

Photo: zoommer
Changing the color of cigarettes from white to a darker hue would make them less attractive to (potential) smokers, reports Dutch News, citing the National Institute for Public Health and the Environment (RIVM).
Darker colors suggest a stronger taste and more damage to health, RIVM researchers noted. White, by contrast, is associated with a safer product. Selling cigarettes in darker colors would help the government achieve its aims of zero children smoking and only 5 percent of over 18s smoking by 2040, as stated in the national prevention agreement, the RIVM said.
Changing the color of cigarettes would require a change in Dutch law, however, which states that cigarettes should be white. Another option to discourage smoking would be printing health warnings both on the packaging and the cigarettes, according to the RIVM.
The RIVM opposes a ban on filters, which contain plastics and harmful chemicals, because it may create the impression that filterless cigarettes are less unhealthy. The RIVM is compiling a list of ingredients in tobacco and vaping capsules that may be banned by law, including vitamins.
The results of the RIVM research will be used in policy to discourage smoking, Junior Health Minister Maarten van Ooijen said, although some recommendations, such as lowering nicotine content, would have to be decided on a European level.
April 17, 2023
Pakistan To Miss Tax Target Due To Illicit Sales

Photo: Piotr Pawinski
Pakistan is unlikely to achieve its tax collection targets due to the rapid growth of illicit cigarette sales, reports Geo News, citing Philip Morris Pakistan Chief Financial Officer Muhammad Zeeshan.
In February, the government increased the Federal Excise Duty on cigarettes in an attempt to boost revenues in line with the conditions for financial support from the International Monetary Fund.
Following the tax hike, the duty on locally produced cigarettes retailing for more than PKR9,000 ($32.02) per 1,000 sticks is PKR16,500 while the duty on locally produced cigarettes retailing for less than PKR9,000 per 1,000 sticks is PKR5,050. The government aims to fetch an additional PKR11 billion ($39.13 million) in revenue with the measure.
The excise duty increase has doubled the price difference between legal and illegal cigarettes. As a result, illicit cigarette sales have skyrocketed. In the first quarter of 2023, the sale of legal cigarettes has declined by 50 percent. Pakistan now has the second-largest illicit cigarette market in Southeast Asia after Malaysia.
Due to the declining legal sales, analysts expect the government to collect only PKR170 billion from the tobacco industry—well short of its collection target of PRK260 billion.
April 17, 2023
Stingfree Launched in Sweden

Photo: Sting Free
Sting Free modern oral nicotine pouches have been launched in Sweden.
The Stingfree technology reduces the burning sensation and irritation on the gums, which is typical of regular snus and oral nicotine products, according to a press release. Several e-commerce distributors and stores are now selling the first product in an upcoming series of tobacco-free nicotine pouches with different flavors and strengths.
Several studies have shown that many snus users suffer damage to and changes to the gums, especially where the pouches are in direct contact with the gums. The U.S./EU patented Stingfree technology aims to counteract this and the associated burning/irritating sensation by having an impermeable barrier on the gum side of the pouch. A high percentage of snus users dislike when nicotine pouches and snus stings/burns and irritates the gums. This has been established by Sting Free AB in a comprehensive survey in 2022, with responses from over 1,000 Swedish snus users (of which almost 40 percent were women). Of the respondents, 67 percent of the women considered that the burning/stinging sensation, regardless of when it stings, is unpleasant as did 53 percent of the men. Almost 50 percent of the respondents had had oral health problems pointed out by their dentists linked to their use of snus/nicotine pouches.
A recent survey of U.S. females investigated why the use of smokeless tobacco products like nicotine pouches and snus is so much lower among women compared to men. A main factor concluded from the responses was the burning sensation and oral irritation caused by these products, with comments such as “irritation,” “burn,” “hurts my gums,” etc. Other factors were “negative stereotypes about smokeless users,” “deadly misconceptions” that smokeless products are more dangerous than e-cigarettes and smoking and the unfamiliar mode of delivery.
Sting Free AB’s vision is that the Stingfree technology will become a new industry standard for nicotine pouches and traditional smokeless tobacco products like snus and that customers in the future will be asked the question, “Regular or sting-free?” when they buy such products. The company also hopes that the technology will contribute to more smokers opting out of smoking in favor of significantly less dangerous nicotine pouches.
April 14, 2023
Survey: Americans Support Harm Reduction

Image: Maren Winter | Adobe Stock
Two out of three Americans support tobacco harm reduction over blanket prohibition as the better policy approach to tobacco regulation, according to a survey released by Altria.
The survey also shows that 82 percent think it is important for the U.S. Food and Drug Administration to focus on making smoke-free tobacco products available to adult smokers to help them switch from cigarettes.
“There is clear, overwhelming support for the FDA embracing harm reduction for the 30 million American adults who smoke. That means providing adult smokers who are unable or unwilling to quit with wider access to smoke-free alternatives and providing them the information and support to help them switch,” said Paige Magness, senior vice president of regulatory affairs at Altria Client Services. “Pursuing harm reduction is one of the most powerful steps the FDA can take to deliver on its mission to reduce tobacco-related death and disease in the U.S. It is our hope that the FDA will listen to these voices as it sets out its policy agenda for the coming years.”
The survey also shows that 90 percent agree that the FDA has a responsibility to accurately inform adult tobacco consumers about the risks associated with different tobacco products, and 88 percent agree that the FDA has a responsibility to address the widespread misperception that nicotine causes cancer.
Most adults also agree that policies that ban tobacco products will lead to illicit markets for tobacco products, endangering public health, youth and communities of color.
“Most Americans understand that prohibition-based policies don’t work and that it’s much better for public health to keep tobacco products legal and regulated,” said Magness. “Harm reduction is the better path forward. With harm reduction, regulators provide adult smokers with information, choice and support to expand the off-ramp from smoking—while also continuing to drive down underage use.”
The survey results also underscore the clear expectations that adults have for physicians to help adult smokers who want to switch, according to Altria. Seventy-nine percent agree that if certain tobacco products have been scientifically shown to be less risky than cigarettes, physicians have a responsibility to communicate this information to their patients who are adult tobacco consumers and have not successfully quit smoking by using traditional cessation therapies.
In addition to general population adults, the survey asked primary care physicians about their views on tobacco harm reduction. Of those surveyed, 89 percent support tobacco harm reduction as a public health concept and 85 percent believe it is important for the FDA to focus on making smoke-free tobacco products available to adult smokers to help them switch from cigarettes to less harmful alternatives.
Policy professionals were also surveyed and overwhelmingly believe that harm reduction is a better approach for the FDA to focus on than prohibition (78 percent), that tobacco products should remain legal so they can be properly regulated (77 percent) and that the FDA has a responsibility to accurately inform adult tobacco consumers about the different levels of risk associated with tobacco products (96 percent).
April 14, 2023
Estonia to Increase Excise on Tobacco

Image: Tobacco Reporter archive
Estonia’s incoming government plans to increase the excise duty on tobacco and alcohol products, but the rate has not yet been released, according to The Baltic Times.
“The coalition partners have agreed upon a slow yearly growth, and a proposal by the finance minister is expected regarding concrete rates,” said Merlyn Sade, head of communications at the Social Democratic Party.
Mart Vorklaev, the Reform Party’s finance minister designate, said that it has been agreed upon that the taxation of health-related risk-taking behavior would continue and that an increase needs to be avoided in cross-border trade.
“It should also be a part of the tax package that’s planned to be brought into the Riigikogu during the spring session,” Vorklaev said. “We will try to adhere to the principle that tax changes be known six months before they enter into effect, and we’ll also monitor our neighboring states’ tax rates to prevent cross-border trade.”
“The difference in excise duties with Latvia is small at present,” said Sven Sulga, Distillery Moe OU sales manager. “If Latvia doesn’t increase its duty rate, people might not go to Latvia [to buy alcohol] in the first year, but they will start doing it after that. Looking at all the incoming taxes, however, I think people will go to Latvia out of spite.”
“It would definitely be interesting to know how the state plans to avoid, in the case of products subject to high excise duties, a future scenario where the same goods can be obtained at a cheaper price from our neighboring countries and the Estonian taxpayer decides to take their money there instead,” said Kristina Mustonen, CEO of Maxima Estonia. “I am of the opinion that the increase in excise duty rates will boost alcohol tourism once more, and trade near the border will gain impetus for the benefit of our neighboring state’s budget.”
April 14, 2023
Juul Labs to Pay $462 Million to Six US States

Image: lyudmilka_n | Adobe Stock
Juul Labs has agreed to pay $462 million to settle claims by six U.S. states, including New York and California, that it unlawfully marketed its products to minors.
With the deal, Juul has now settled with 45 states for more than $1 billion. The company did not admit wrongdoing in the settlement, which also included Colorado, Illinois, Massachusetts and New Mexico as well as the District of Columbia.
Juul announced on Dec. 6 it has secured an investment to cover the cost of the settlement. The company has been in talks with two early investors to fund a bailout that would cover legal liabilities.
The states had accused Juul of falsely marketing its e-cigarettes as less addictive than cigarettes and targeted minors with glamorous advertising campaigns, according to Reuters.
“Juul’s lies led to a nationwide public health crisis and put addictive products in the hands of minors who thought they were doing something harmless,” New York Attorney General Letitia James said at a news conference.
The company said that use of its products by people under age 18 had fallen by 95 percent since the fall of 2019, when it changed its marketing practices as part of a “company-wide reset.”
In September, Juul Labs agreed to pay nearly $440 million to settle a two-year investigation by 33 U.S. states into the marketing of its vaping products.
Juul’s e-cigarettes were briefly banned in the U.S. in late June after the Food and Drug Administration concluded that the company had failed to show that the sale of its products would be appropriate for public health. But following an appeal, the health regulator put the ban on hold and agreed to an additional review of Juul’s marketing application.
In October, Juul published the details of its MDO appeal. In late September, Juul shareholder Altria Group exercised the option to be released from its noncompete deal with the e-cigarette maker.
Last month, Altria Group exchanged its entire investment in Juul Labs for a nonexclusive, irrevocable global license to certain of Juul’s heated-tobacco intellectual property.
April 13, 2023
Smoking Down Among Danish Youth

Image: Tobacco Reporter archive
Cigarette consumption among Danish youth has declined, but the use of nicotine products has increased, reports The Local Denmark.
Snus, nicotine pouches and vaping devices have become more popular with youth in Denmark, with 35.1 percent of 15-year-olds to 29-year-olds using these products daily or regularly, up from 26.3 percent in 2020.
Cigarette use fell to 19 percent from 20.1 percent while smoke-free nicotine product use increased to 12.9 percent from 9.1 percent, according to a study by Denmark’s National Institute of Public Health and the University of Southern Denmark on behalf of the Danish Health Authority.
“We also found that it is especially newer products, such as vaping devices and smoke-free nicotine products, that seem to be especially popular among very young people,” said Nanna Jarlstrup, one of the report’s researchers. “That is naturally concerning.”
“We are also unfortunately seeing use of some of the illegal products increasing. That is, for example, the new disposable vapes, Puff Bars,” Jarlstrup said.
“It’s not legal to sell them in Denmark, but we can see young people have access to them because they use them,” she said.
The number of people aged 15 to 17 who smoke has increased despite fewer people aged 18 to 24 smoking cigarettes daily or occasionally compared to 2020.
Denmark has banned smoking during school and further education hours and removed cigarettes from displays in stores as well as increased the price of a pack of cigarettes to help decrease smoking.
April 13, 2023
Imperial On Track to Meet Full-Year Guidance

Image: Tobacco Reporter archive
Imperial Brands is on track to deliver full-year results in line with expectations and the company’s guidance of low-single-digit constant currency net revenue growth. Over the next three years, the company continues to expect operating profit growth to accelerate to a mid-single-digit CAGR at constant currency.
The company has seen a robust tobacco pricing and stable aggregate market share across its top 5 combustible markets against a strong comparator.
Product launches across vapor, heated tobacco and modern oral have driven next-generation product net revenue growth.
First-half group adjusted operating profit is expected to be at a similar level to last year on a constant currency basis. Tobacco and next-generation product (NGP) adjusted operating profit has been impacted by the planned increase in NGP investment, the impact of the company’s exit from Russia and the continued unwind of Covid-19. Growth in distribution adjusted operating profit has helped to mitigate these headwinds.
Imperial is on track to meet full-year expectations and its guidance of growing revenue and operating profit. The company completed £523 million ($654.82 million) of the fiscal year 2023 £1 billion share buyback as part of an ongoing program of capital returns.
The interim results for the six months ended March 31, 2023, will be announced on May 16, 2023.
April 13, 2023